17 Aug 2017

Superannuation- Changes In The Reform

Superannuation- Changes In The Reform

As of July 1, the government has taken the following measures in order to make the superannuation system more sustainable and flexible enough to suit modern work patterns.

  • New tax threshold for high-income earners is $250,000, leading to 15% tax increase and annual concessional (before-tax) contributions capreduced to $25,000.
  • Non-concessional contribution eligibility for bring-forward provisions has been reduced to $100,000 and $300,000. People under 65 age can bring up to 3 years of non-concessional contributions.
  • Tax deductions can be claimed by anyone under the age of 65 and those within 65-74 age range who satisfy the work test.
  • $1.6 million capons the total amount that can be moved into the tax-free retirement phase, without restrictions on the money earned on that balance during the retirement phase.
  • Low-income earners(for individuals earning up to $37,000) will have tax refunds on the concessional contributions up to a cap of $500, sent to their superannuation accounts.
  • People with a total superannuation balance of less than $500,000 before the start of a financial year can use any carried forward unused concessional contributions for up to five years.
  • People having less than $500,000 superannuation balance before the start of a financial year can use for 5 years and carried forward unused concessional contributions.
  • Spouse tax offset for recipient spouses earning up to $40,000.
  • More flexibility by extending tax exemptions during retirement phase.
  • 15 per cent tax on taxable income from assets aiding retirement income streams with tax-free pension payments for individuals over 60. No more treating of certain superannuation income stream payments as lump sums.
  • Abolishing of the anti-detriment rule with lump sum death benefits still being tax-free.
  • Choose a qualified expert to guide you through these financial complex changes.


 
 

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